Strategies for Growth

With the vast majority of kitchen and bath dealers reporting strong sales in 2005, planning for 2006 becomes something of a challenge. They must ask themselves, is it best to take the “don’t fix what’s not broken” strategy, or continue to make changes to try to enjoy even bigger success in 2006?

Most dealers interviewed by Kitchen & Bath Design News seem to be taking something of a split approach: continuing along the lines of what worked so well for 2005, while staying open to new profit opportunities.

Planned growth strategies vary widely among dealers and designers, based on location, size and client preferences, yet most revolve around carefully defining target clientele, rethinking dated marketing strategies, and pumping up displays, product offerings and staff.

Target Clientele

For the majority of kitchen and bath dealers and designers interviewed by KBDN, a big part of their business strategy for the coming year involves refining their target clientele.

However, this can mean many things: Some dealerships see broadening their client base as the best way to grow sales, while others see becoming more niche-specific as the best route to growth.

According to Jill McGlaughlin, president of Classic Kitchens, Inc. in Harrisonburg, VA, broadening her firm’s horizons is the best way to ensure future growth. As she notes, “We have seen the need to be diverse. We are trying to capture both new construction and the remodeling market. Sure, the building boom is great, and it’s been [great for our business], but we know that we also need to have that remodeling aspect in our scope.”

Notes Bob Harvey, owner/president of Canyon Cabinetry and Design, Inc. in Tucson, AZ, “[Our target clientele] has really changed, and not necessarily because we have steered the boat, so to speak. The market itself here has driven things in a direction that we have needed to stay with and then become very well versed at.”

For one thing, his area is getting “more people who are transplants or coming in from other areas rather than the Southwest.” This means not just catering to the Southwest design influences that were prevalent in Tucson in years past, but also broadening design offerings for these transplants.

He further states, “Tucson is an extremely hot market right now. This is a resort area, and there is a lot of new construction and a lot of remodeling. As a result, [we not only have more jobs], but our jobs have grown in price range. People here are becoming more sophisticated buyers who demand a higher quality product and are asking for more custom finishing touches.”

In addition, he points out, “The big box stores still carry the DIY market, [and these stores] may not tackle [the more upscale] gourmet endeavors; [their clients generally don’t] go for those higher-end product lines. So the home centers [in effect] change the type of people who walk into our showroom.

Over at Templer Interiors in San Francisco, CA, owner Susan Templer has been targeting a more upscale clientele for 2006 by updating her Web site. She explains, “I currently have a Web site that has been bringing in more business all the time, so I am in the process of both handling a lot of new work and trying to incorporate a whole new look for the site. It is about three years old right now and I think if it got a more modern, slick look with some of the flash features, that would help to bring in a higher-end client. I haven’t done anything for 2005 on this, but for 2006, I hope that I will be able to [move to a higher-bracket clientele], in part through the updated Web site.”

Templer is also planning to be a bit more selective with clients, and with the type of work she takes on in ’06. She explains, “I really look at what has been coming in – I take a good hard look at the leads from my Web site and referrals from contractors, and then I choose what jobs I am going to take and what my focus will be, naturally looking toward taking on more of the bigger and higher-end jobs.”